Mortgage lending up, remortgaging down

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The housing market has been given a slight boost with news that the number of mortgages provided by lenders crept up in February.

Figures from the Council of Mortgage Lenders (CML) show that there were 24,300 house purchase loans worth £3.1 billion handed out, compared to 23,400 in January, which were also worth £3.1 billion.

While the news is encouraging, activity is still historically low; the average number of loans for house purchases in February between 2002 and 2007 was 76,000.

Remortgaging dropped markedly as 35,000 remortgage loans were given out, compared to 44,000 in January, representing a decline of 20 per cent.

The CML said it expected remortgaging to remain muted.

Michael Coogan, director general of the council, said that the figures show signs of improvement at the beginning of the borrowing process but stressed that activity is still at a very low level.

"We are not convinced that underlying trends have shifted sufficiently to change our forecasts for the mortgage market activity in 2009, but there are some positive signs for later this year," he added.

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